Cryptocurrency

Bitcoin mining firm Iris Energy on verge of $103M loan default

Tweet from a Bitcoin Magazine analyst Dylan LeClair BTC mining firm Iris Energy said it was close to defaulting on a $103 million loan held by BTC. New York Digital Investment Group (NYDIG).

He further stated that ASIC miners are being held as collateral against loans, meaning that if Iris Energy fails to meet its repayment schedule, the mining equipment will be confiscated.

The terms of the loan call for repayments of principal and interest totaling $7 million per month. However, the company’s current mining revenue is lacking, generating only $2 million per month.

Bitcoin miners under pressure

In recent weeks, stagnant prices and rising mining difficulty have hampered the profitability of Bitcoin mining.

Reported by Hashrate index The website, released Oct. 19, said several factors were putting “a lot of pressure on the bitcoin mining industry” in the third quarter.

โ€œThe cost to generate 1 BTC has increased significantly since last year due to rising electricity costs and the collapse of hash prices.โ€

Tight profit margins have helped public companies sell mining equipment to pay off debt, with ‘damaged asset sales’ materializing during the quarter.

The market value of Iris Energy’s miners is estimated at $65 million to $70 million, significantly less than the principal amount.

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